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Home REIT to strengthen management and board in wake of allegations

Home REIT says that it will strengthen its management team and bring in independent pre-purchase valuers as part of several changes to “maintain and enhance shareholder confidence” following a number of allegations in recent weeks.

The company will also beef up its board with the appointment of a new non-executive director and hire the services of a national Property Management firm to carry out property management services on its portfolio.

The changes announced today comprise:

  • Material investment in further resourcing its dedicated in-house team, including hiring additional senior level investment professionals, to work alongside Charlotte Fletcher and Alex Baker, the senior fund managers. Fletcher has also decided to reduce her maternity leave, returning to work in January 2023.
  • The company will also appoint, at the sole cost of the investment adviser, an experienced and specialist national Property Management firm, to carry out a full suite of property management services, including rent invoicing and collection and tenant liaison and monitoring.
  • The commencement of a review of skills and capability at board level and will recruit an additional Non-Executive Director with a particular focus on direct experience in property and ESG matters. A further announcement on this is expected in January 2023.
  • Implementation of several enhancements to its due diligence processes, including:
    • Working with tenants to improve their asset monitoring procedures so that rare and ad hoc contractual breaches, for example with residents sub-letting rooms, are identified, and addressed more efficiently.
    • The possible intorduction of additional landlord protection clauses in tenant leases.
    • An independent valuation on all property acquisitions prior to purchase from a valuer other than its own external valuer to provide additional assurance in relation to both purchase price and subsequent valuations.
  • Provision of enhanced disclosures relating to its portfolio and around the underlying operational performance of its assets. This will include additional disclosure around geographic locations of the assets and a list of the company’s largest development partners, as well as providing stakeholders with further opportunities to meet the company’s tenants and visit properties where possible.

The company says it expects to publish full year results (for the period to 31 August 2022) by no later than 31 January 2023, after they were delayed for its auditor to carry out an additional audit of the accounts following the allegations made by short seller Viceroy.

Year end accounts are required to be published within four months (which in the case of Home REIT is 31 December 2022) and if this deadline is not met, the FCA will temporarily suspend the company’s listing until the audited accounts are published. The company says that it is working tirelessly with the auditor to publish results as soon as possible.

Dividend

The company also declared a dividend for the quarter to 31 August 2022 of 1.38p per share, to be paid on 20 January 2023 (ex-dividend date 22 December 2022).

HOME : Home REIT to strengthen management and board in wake of allegations

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